Abbott says government can't be trusted on carbon tax

Posted
July 11, 2011 08:40:00

The federal opposition leader Tony Abbott has promised to fight the carbon tax all the way to the next election and beyond. He says the package sets up the next election as a referendum on the carbon tax.

TONY EASTLEY: The Federal Opposition Leader Tony Abbott is also promised to fight the tax all the way. He says the next election will be a referendum on the carbon tax itself.

Mr Abbott spoke with chief political correspondent Sabra Lane just a short time ago.

SABRA LANE: Tony Abbott, welcome. This scheme will get through Parliament and when it does and when people are compensated, aren't they going to think what was all the fuss about?

TONY ABBOTT: I don't think you can assume it will get through the Parliament, Sabra. There are a lot of Labor members who are very unhappy, members in mining seats, steel-making seats, motor manufacturing seats. I think one of the reasons why the Prime Minister didn't want to announce this in a sitting week is because she didn't want to face the caucus.

Let's face it, this was a package designed by the Greens. It wasn't a package that was designed by Labor and it certainly wasn't a package that Labor members of Parliament had any real input to.

SABRA LANE: You've said that you'll rescind this tax in government; will you roll back all the tax cuts and all the additional welfare payments too?

TONY ABBOTT: Look, this is a bad tax and we are against it. We say that you can't fix it, you've just got to fight it.

SABRA LANE: Will you roll back the tax payments and the additional welfare payments?

TONY ABBOTT: Well, look what I've said and I'm very happy to keep saying it is that under the Coalition, there will be a tax cut without a carbon tax. Under the Coalition there will be a fair go for pensioners, a fair go without a carbon tax.

SABRA LANE: So you'll roll it all back?

TONY ABBOTT: Well, as I said, we haven't seen the legislation.

SABRA LANE: You're being very tricky.

TONY ABBOTT: No, I'm not being tricky I am just telling you our position. Our position is that there will be a tax cut without a carbon tax and there'll be a fair go for pensioners because there won't be a carbon tax.

SABRA LANE: Well, how will you pay for all of that?

TONY ABBOTT: Well, as I said many times before, Sabra, let me repeat it again on your program, in good time before the next election, we will announce our fiscal position and we will pay for tax cuts out of spending reductions and the thing is Sabra that a tax cut that is paid for by tax increase, it is not a cut. It is a con. These are mirage tax cuts.

SABRA LANE: Given that this tax package is dove-tailed with tax reform, your job of rolling it back has been made pretty difficult, hasn't it?

TONY ABBOTT: Look, Sabra, it is myth to describe this as tax reform. This is the first time in a generation that marginal tax rates have been increased. The 15 per cent rate goes up to 19 per cent; the 30 per cent rate goes up to 33 per cent. Low and middle income earners face an increase in their marginal tax rates. That is not reform.

This is a big tax retrospect-a-scope. That is what it is. Bob Hawke and Paul Keating would be appalled to see this done to the kind of tax reform that they supported.

SABRA LANE: But some economists say that lifting the tax free threshold is pretty significant.

TONY ABBOTT: I have supported lifting the tax free threshold. What I haven't supported and wouldn't support is an increase in marginal tax rates. That is going backwards. That is reducing the work incentives for low and middle income earners. This is an attack on aspiration. This is an attack on the aspirational classes of our country. That's why it is not fair dinkum reform.

SABRA LANE: The Treasury modelling shows that the price impacts on families will be quite minimal. At the supermarkets milk will go up by about a cent, eggs two cents.

TONY ABBOTT: Um, this tax is just going to go up and up and up Sabra. The carbon price is going to be $29 a tonne in 2020 and that is in 2010 dollars. The carbon price is going to be $131 a tonne in 2050 and that's in 2010 dollars. So look, this price is just going to go up and up and up and I don't think believe this Government.

Even on the Government's own figuring, more than three million households are going to be worse off. A single income family with one child under five, on average weekly earnings, is going to be worse off and that's even on the Government's own modelling.

SABRA LANE: You say that you don't trust these figures but they've come from Treasury, the same mob that modelled your GST.

TONY ABBOTT: As I said, I don't think people are going to believe this Government. I mean why is the Prime Minister any more believable now than she was six days before the last election when she said ...

SABRA LANE: But you don't trust the figures, they haven't ...

TONY ABBOTT: Let me finish Sabra, when she said six days before the last election there will be no carbon tax under the government I lead.

SABRA LANE: You are going to travel the nation now, much like the Prime Minister, will you visit any steel mills, will you visit Whyalla? You said Whyalla would be wiped off the face of the Earth.

TONY ABBOTT: Well, that was the Australian Workers Union and does anyone think for a second, Sabra, that there wouldn't be a steel package had I not been out there fighting for the steel industry, day after day after day. Does anyone not think that if the steel industry was safe the Government would have announced this straight away?

No, no, no, I am very pleased to have helped bring about what is a better outcome for the steel industry but I think everyone in the steel industry understands, this is a stay of execution. It is not a permanently good deal.

SABRA LANE: Well, Blue Scope and OneSteel both say that are pretty happy with the package.

TONY ABBOTT: Well, let's wait and see what happens to employment at Whyalla and Port Kembla.

SABRA LANE: So I take it you won't be visiting steel mills?

TONY ABBOTT: Oh look, I will be visiting the workers of this country and letting them know that this is a toxic tax. Let's put the boot on the other foot. Will Julia Gillard be going to Whyalla? Will Julia Gillard be going to Port Kembla? I tell you where she'll be going, she'll be going to university campuses, that's where she'll be going.

She won't be going to the factories and to the mines where the Australian workforce and where traditional Labor voters congregate.

SABRA LANE: The Government will put its additional steel compensation package through Parliament. That will then put the heat on you. Will you pass it?

TONY ABBOTT: Look, this is a bad deal for the steel industry. At best it is a stay of execution and as I said Sabra, look and see what happens to employment at Whyalla and Port Kembla and that's where we'll discover whether this really is a good package for the steel industry.